It was a pretty quiet week for rate changes but we did see the best rates of the year being launched.
- One-year money is down 0.02% at 4.54%
- Two-year money is down 0.03% at 4.49%
- Three-year money is down 0.01% at 4.52%
- Five-year money is up 0.02% at 4.56%
While I was impressed to receive an email on Sunday at 5pm (I guess someone was not watching Songs of Praise
or Liverpool vs Chelsea) I’m disappointed Alliance & Leicester pulled its rates with just one day’s notice. I know they were good rates but I’m surprised it could not manage its tranches better. It’s not as if the decision was brought about by other lenders pulling rates. If anything, recent launches should have helped it. Lenders must give more notice than this or brokers will lose face with their clients. Anyway, A&L’s new rates are 4.29% fixed for two years up to 250,000 and 4.39% fixed for two years from 250,000 to 750,000, plus a 4.39% two-year fully flexible tracker.
And don’t forget A&L has also increased the 4.29% rate’s arrangement fee to 495. The 4.39% rates fee remains a substantial 595.
BM Solutions’ annual money sale has just started. It has launched some awesome mainstream products. One is at base less 0.75% for two years, 1,499 fee. Then there is a base less 0.51%, free conveyancing and refund of valuation (up to the usual 490) and 3.89% fixed for two years with a 1,499 fee. These have no overhangs and are available to 90% of 500,000. For small loans these will definitely not appeal but for large loans they look incredible and I’m sure they will grab a massive portion of the large loans market until these rates get pulled. These three rates share rate of the week.
Nobody will dispute the magnitude of the achievement of Michael Bolton, Alan Cleary and the team in creating probably the most broker-focussed lender in the industry. I think the system that they have built will endure and there are still a lot of great people there. I have no doubt managing director Nigel Stockton, sales and marketing director Tim Hague and head of sales Martin Reynolds and the others left will continue to build on BM Solutions’ achievements. Looking at its mainstream rates, they are going to be rather busy.
Cheshire launched a two-year fixed buy-to-let remortgage rate at 4.94%. It has fees-free conveyancing and a free valuation on properties valued up to 750,000. Clients are allowed to capital raise for any purpose. The rental calculation is based on 130% of monthly payment calculated at the pay rate. It is available to 80% LTV. There is a 100 non-refundable fee payable on application with 395 added on completion.
The Woolwich repriced a number of buy-to-lets. Highlights include a couple of products with a 1.5% arrangement fee, a two-year fixed up to 75% LTV at 4.69% and a two-year fixed up to 85% at 4.99%. Don’t forget The Woolwich will lend up to 5m for buy-to-let. It sent a separate email to advise us of residential rate changes which did not say what the new pay rates were but at least gave a product description of the new rates and said what had been pulled so we weren’t wracking our brains to remember GSN numbers. It has new two and five-year fixed rates without application fees at 4.89% and 4.99%. These are good for small loans but compared with other mainstream lenders’ 4.29% two-year fixed rates it would have to be a loan less than 50,000 or so.
I feel a bit sorry for Bank of Scotland which last week launched its large loans tracker product at base less 0.61% for two years, but the fee is 2,500 and has two years of extended early repayment charges.
Over in the City, three-month LIBOR is unchanged at 4.60% so the market sees little chance of change in the next three months. Twelve-month LIBOR is down 0.05%at 4.54% indicating the City thinks there will not be further decreases in base rate in the next 12 months.
Jonathan Cornell is technical director at Hamptons International Mortgages